Taking Care of Medical Business: Healthcare in Iran

Milad Hospital in Tehran

Iran’s health sector is a regional leader in the Middle East and Central Asia. It is middling by world standards, but has the fundamentals in place and strong indigenous capabilities to build on. Pride in medical skill and healthcare has roots in Iran’s antiquity: the Academy of Gondishapur in south-western Persia was the model for early hospital and medical schools the world over. In the Islamic Golden Age – Europe’s Dark and Middle Ages – as Gondishapur’s best moved to the Islamic capital of Baghdad, Iran still boasted the greatest physicians of the time. The Canon of Medicine, written in Arabic by Persian renaissance man Avicenna, was the standard medical textbook in East and West up until the 17th Century. This legacy of Persian medical skill remains a point of pride for many Iranians and still underpins the country’s significant indigenous capabilities in health and medicine.

The Standing of Iran’s Health

In efficiency of provision, Iran was ranked 46th in the world in 2014. Due to 2012 sanctions that cut access to crucial medical and pharmaceutical supplies from international sources over several years, this was a decline from earlier rankings. But with a 7.8% GDP spend on healthcare, Iran’s domestic capabilities are broad and well established in medical research and health provision as well as significant domestic pharmaceutical production capacities. It has a solid and sustainable foundation on which to build a globally competitive sector. Like much of Iran’s economy, health is a sector that is underdeveloped – but certainly not undeveloped. It can be improved with international collaboration that builds on existing Iranian capabilities.

As one Australian Associate Professor in Management to visit Iran recently noted, the country has world-class medical researchers and practitioners but: “Medical research, one of Australia’s big achievers, is an obvious area of collaboration. The University of Queensland already has strong medical and engineering research collaboration with Iran, although this has diminished recently because of the sanctions.” As Iran’s economy emerges from under the weight of sanctions the possibilities for mutually beneficial collaboration and investment in medicine and health are numerable, even as it has made significant progress dealing with long-term issues in healthcare.

The Iranian Health System

Iran’s health sector is composed of a relatively sophisticated and versatile network of public, private, and non-profit organisations. For the most part, these interact successfully to deliver a sufficient level of care for the Iranian population, with a delivery of generally consistent and equitable primary care. However, Iran’s ability to meet secondary and tertiary health care needs remain behind developed primary provision. Iran’s constitution mandates equitable public healthcare for the entire Iranian public, a goal which has been commendably approached by the Islamic Republic.

A reason for the effectiveness of Iran’s health care sector is that the Ministry of Hygiene, Treatment and Medical Training – the Ministry of Health – integrates and matches medical education and training with all aspects of health care delivery across the country in long-term policy setting. This has allowed Iran to avoid some problems that plague other health sectors worldwide, such as the undersupply of specialised medical professionals as in Australia. This system provides a sustainable and well-integrated health system across the country. The private and non-profit actors in Iran’s health industry are generally specialised outfits in urban areas that focus on secondary and tertiary care.

Iran As a Hub for Health Tourism

The capacity of Iran’s health market, relatively developed and high quality for the region, attracts health tourists from around the Middle East and Central Asia. Between 30-50,000 people visit Iran for medical purposes annually. This number is made up of two distinct groups: those from neighbouring countries seeking higher quality medical care not available at home and visitors from more developed countries seeking medical treatments affordably. Iranian capabilities in health tourism are developed to the extent that they are well coordinated with dedicated tourism companies, health care providers, and non-profit organisations by both the Health Ministry and the Ministry for Tourism for full service in both tourism and medical aspects. In this way, particularly as Iran’s tourism sector strengthens and its underlying infrastructure and capacity is improved, the number of medical tourists of both types visiting the country will grow.

With an already developed infrastructure and capability in health tourism, Iran’s health sector is a good prospect to develop further and provide access to other regional markets as a hub demanding the best equipment, systems management, and expertise.

Opportunities for Partnering and Cooperation

So while Iran’s capacities are strong, there is still much room for improvement. In particular for foreign companies opportunities lie in the updating and improvement of hospital systems by partnering with Iranian operators, public and private. While the quality of medical research and capabilities in Iran is high, systems management in Iran is outdated and inefficient. Given the national integration of the sector in Iran, foreign companies who successfully enter have a wealth of opportunity to expand and engage the broad market. With changing demographics and rising expectations, Iran will need to continue to improve its healthcare capabilities in ways that international expertise collaboration will be indispensable in the long term.

Under President Rouhani, healthcare has received renewed attention as a priority policy area with significant funding increases. A major new countrywide scheme called Tarh-e Salaamat – dubbed the ‘Health Plan’ or Rouhani-Care – has reinvigorated the sector and brought new hope for strides forward. Even while showing some of the lingering weaknesses in the sector, not least outdated and inefficient systems, it has also showcased Iran’s significant and long-standing healthcare capabilities.

To find out more about Iran’s healthcare and medial sector, join our webinar, Spotlight on Iran: Highlighting emerging business opportunities on Tuesday 19 April, 2016 at 5.00pm AEST. Click here to register.

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